Mallinckrodt to buy Questcor in cash-and-shares deal

Bid represents 27% premium to Questcor’s closing price on Friday

By

TessStynes

An earlier version of the story misstated Acthar’s sales and didn’t reflect payment for stock options in the total acquisition price.

Mallinckrodt PLC agreed to buy Questcor Pharmaceuticals Inc. for about $5.6 billion in cash and stock, in a deal expected to expand the scale and diversification of the specialty pharmaceutical company.

Ireland-based Mallinckrodt
MNK, +1.86%
would gain Questcor’s
US:QCOR
H.P. Acthar gel, an injectable drug which has U.S. Food and Drug Adminstration approval for 19 indications, many related to autoimmune and inflammatory conditions. Sales of Acthar, which is Questcor’s biggest product, rose 50% to $761.3 million in 2013 and make up almost all of Questcor’s revenue.

Questcor

Questcor’s operations will function as a separate business unit within Mallinckrodt’s specialty pharmaceuticals segment.

Mallinckrodt President and Chief Executive Mark Trudeau will lead the combined company. The company also expects to add Questcor executives to Mallinckrodt’s leadership team.

Questcor shareholders will receive $30 a share in cash and 0.897 Mallinckrodt shares for each share of Questcor that they own, valuing the offer at roughly $86.10 a share. The bid represents a 27% premium over Questcor’s Friday closing price.

After the deal closes, which is expected in the third quarter, Mallinckrodt holders will have a 50.5% stake in the combined company, while Questcor holders will have the remainder.

The deal is expected to add to fiscal year per-share earnings this year and significantly boost them next year.

Intraday Data provided by SIX Financial Information and subject to terms of use.
Historical and current end-of-day data provided by SIX Financial Information. Intraday data
delayed per exchange requirements. S&P/Dow Jones Indices (SM) from Dow Jones & Company, Inc.
All quotes are in local exchange time. Real time last sale data provided by NASDAQ. More
information on NASDAQ traded symbols and their current financial status. Intraday
data delayed 15 minutes for Nasdaq, and 20 minutes for other exchanges. S&P/Dow Jones Indices (SM)
from Dow Jones & Company, Inc. SEHK intraday data is provided by SIX Financial Information and is
at least 60-minutes delayed. All quotes are in local exchange time.